On June 13, the U.S. House Judiciary Committee’s Subcommittee on the Constitution and Civil Justice held a hearing on “Lawsuit Abuse and the Telephone Consumer Protection Act”. The House Energy & Commerce Committee has primary jurisdiction over the TCPA. But the Judiciary Committee oversees all matters related to the administration of justice in federal courts and has been active on a number of litigation reform matters, including most recently class action reform legislation. The Subcommittee held the hearing in response to the fact that between 2010 and 2016, TCPA case filings increased by 1,272%, and today TCPA lawsuits are the largest category of class actions filed in federal court. Although some of the Subcommittee’s Democratic members, including Ranking Democrat Steve Cohen (D-TN), questioned the Committee’s jurisdictional interest in the TCPA, the hearing focused on TCPA reform––specifically with an eye toward reducing lawsuit abuse, and the Republicans said they would work with Energy & Commerce on any legislative proposals.
By Stephen J. Matzura and Marty Stern
The FCC, at its open meeting last week, adopted a number of key items on the broadcast incentive auction, which it hopes to kick off by March 2016. If successful, the incentive auction will allow participating broadcasters to receive payment for relinquishing their spectrum and will make spectrum available in the 600 MHz band for auction to wireless providers.
Among a raft of complexities, the process will require that remaining broadcasters be “repacked” in the band from their existing channels. At the same time, it will provide for unlicensed use (think Wi-Fi and TV “white space” devices) of guard bands between wireless and broadcast frequencies, and what is known as the “duplex gap” — vacant space between the uplink and downlink operations of the new wireless providers in the band. In one contentious move, the Commission agreed to provide flexibility in the repacking process by authorizing as necessary the relocation of broadcasters to the duplex gap in particular markets, which would render that spectrum unusable for unlicensed operations in those markets. In a compromise brokered by Commissioner Rosenworcel, the Commission agreed to seek comment on whether it should preserve a vacant channel in such markets for unlicensed and licensed microphone use.
On August 3th, the National Telecommunications and Information Administration held the first in a series of “multi-stakeholder meetings” among participants in the unmanned aircraft systems (UAS, a.k.a. drones) industry to help create possible industry guidelines on privacy, transparency, and accountability issues. As we discussed here, the meetings are being held pursuant to President Obama’s February 15, 2015 Presidential Memorandum. The purpose of the first meeting was to discuss high-priority issues to be addressed during the process, and logistics regarding the best way to address the issues – including through the establishment of working groups and concrete goals. Future meetings have been scheduled for September 24th, October 21st, and November 20th.
As originally published in Law360
On Friday, July 10, 2015, the Federal Communications Commission issued its much-anticipated Declaratory Ruling and Order clarifying numerous aspects of the Telephone Consumer Protection Act. The commission had adopted the order at a particularly contentious June 18, 2015 open meeting (see earlier post), which one commissioner called “a farce” and another described as “a new low … never seen in politics or policymaking.”
In an unusual move, the commission made the order effective on its July 10 release date, rather than following publication in the Federal Register as is typical, providing companies with no opportunity to digest the order and adjust business practices accordingly.
As expected, the order largely brushes aside legitimate business concerns and a sensible approach to TCPA regulation in favor of findings that potentially increase risk for businesses in a variety of circumstances, including the possibility of increased class action litigation. In addition, beyond clarifying that carriers may offer call-blocking technologies to consumers, the order offers little to actually protect consumers from scam telemarketing schemes, including offshore “tele-spammers” that use robocalling or phone-number spoofing technologies.
A recent decision by a New York federal court serves as a stark reminder of the need for companies to adopt and follow robust “do not call” procedures in order to minimize the risk of rapidly escalating statutory damages under the Telephone Consumer Protection Act. The case appears to be the first to rely on the Federal Communications Commission’s recently-announced but at the time, unreleased TCPA declaratory rulings (previously discussed here). (The order has just been released, but as of this writing, the link was down.)
The Sixth Circuit recently held that a facsimile which lacks commercial components on its face does not constitute an advertisement under the Telephone Consumer Protection Act and ruled that the possibility of remote economic benefit to a defendant is “legally irrelevant” to determining whether the fax violates the TCPA. The Sixth Circuit’s narrow rule stands out among decisions from other courts that have adopted an expansive interpretation of “advertisement” under the TCPA, and demonstrates that the scope of the TCPA is indeed subject to limitations.
In Sandusky Wellness Center, LLC v. Medco Health Solutions, Inc., the defendant, a pharmacy benefits manager, sent two unsolicited faxes to the plaintiff, a chiropractor. The faxes informed plaintiff that medications covered by defendant’s health plans could help lower costs for plaintiff’s patients, and directed plaintiff to a complete list of “plan-preferred medications” on defendant’s website. The faxes, however, did not promote defendant’s services or solicit business from plaintiff. Nor did the faxes contain pricing, ordering or sales information. Notably, defendant did not offer for sale any of the identified medicines, either in the faxes themselves or on defendant’s website.
The Sixth Circuit recently held that a facsimile which lacks commercial components on its face does not constitute an advertisement under the Telephone Consumer Protection Act and ruled that the possibility of remote economic benefit to a defendant is “legally irrelevant” to determining whether the fax violates the TCPA. The Sixth Circuit’s narrow rule stands out among decisions from other courts that have adopted an expansive interpretation of “advertisement” under the TCPA, and demonstrates that the scope of the TCPA is indeed subject to limitations. Read More
As originally published in Law360
At its June 18, 2015, open meeting, a sharply divided Federal Communications Commission made good on Chairman Tom Wheeler’s recent promise to bolster the Telephone Consumer Protection Act’s already strict rules and to bring about “one of the most significant FCC consumer protection actions since it established the Do-Not-Call Registry with the FTC in 2003.” While plaintiffs’ class action lawyers are likely to applaud the new measures, businesses are concerned that the new rules could unfairly restrict legitimate communications with customers.
Congress enacted the TCPA in 1991 to address what it perceived as the growing problem of unsolicited telemarketing with technologies such as fax machines, pre-recorded voice messages and automatic dialing systems. The TCPA requires anyone making a call to a wireless line using autodialer or pre-recorded voice-call technologies to obtain the “called party’s” “prior express consent,” and, following a 2012 FCC decision, “prior express written consent” for calls that introduce advertising or constitute telemarketing. Similarly, under that ruling, calls to residential lines using an artificial/pre-recorded voice that introduce advertising or constitute telemarketing require the called party’s prior express written consent. Read More
By Stephen J. Matzura and Marty Stern
The FCC has adopted new rules governing accessibility of emergency information in TV programming for blind or visually impaired individuals. The rules require emergency information on TV to be available in audio format on mobile devices when subscription television providers permit consumers to access televised programming using mobile apps.
Under the FCC’s current rules adopted in a 2013 Report and Order pursuant to the Twenty-First Century Communications and Video Accessibility Act, emergency information that interrupts regular TV programming must be accompanied by an aural tone and be available on a secondary audio stream. The new rules require these secondary audio streams to be available “on tablets, smartphones, laptops, and similar devices when subscription television providers, such as cable and satellite operators, permit consumers to access programming over their networks using an app on these devices.” According to the FCC, this will allow blind or visually impaired individuals who hear the aural tones on TV to switch to a secondary audio stream on such devices.
The new rules also require TV equipment that receives or plays back programming (e.g., set-top boxes) to have an activation mechanism that allows blind or visually impaired users to easily switch to a secondary audio stream to hear the emergency information. In partial dissents, Commissioners Pai and O’Rielly disagree that the FCC has authority under the CVAA to require mechanisms on set top boxes and similar devices to activate the secondary audio stream.
The FCC also adopted a Second Further Notice of Proposed Rulemaking to solicit comments on a number of issues, including coordination of multiple on-screen announcements, whether school-related information should be made available on the audio streams, and potential requirements for multichannel video programming distributors.